The major thing that killed 1960s/70s AI was the Vietnam War. MIT's CSAIL was funded heavily by DARPA. When public opinion turned against Vietnam and Congress started shutting off funding, DARPA wasn't putting money into CSAIL anymore. Congress didn't create an alternative funding path, so the whole thing dried up.

That lab basically created computing as we know it today. It bore fruit, and many companies owe their success to it. There were plenty of promising lines of research still going on.